The middle 1950s was a high-water mark for the major companies. The Iranian challenge had been defeated and producer governments were quiescent. Rapidly increasing demand in Europe allowed the progressive development of the highly profitable Middle Eastern finds without creating major tensions elsewhere. The major oil-exporting countries were still being developed almost exclusively by consortia in which the major companies had controlling interests, and elaborate schemes had been arranged to regulate the supply of oil from these countries. In the following 15 years, however, this position was steadily eroded; the actions of producer governments, although essentially defensive, became increasingly important after the formation of OPEC in 1960, but the immediate challenge to the majors came from the independent companies – the newcomers – who were becoming increasingly prominent in the search for foreign oil supplies. Under these circumstances, world prices began to erode and this erosion brought further tensions and conflicts into the international oil market.

The first significant erosion of the major companies' control over the most important non-us oil reserves came in Venezuela, where in 1956 Pérez Jiménez offered a massive new round of concessions to the highest bidders. Good oil prospects, proximity to the USA and a government eager to supplement its major source of income all attracted independent us companies which were willing to undercut established suppliers in order to find marketing outlets.